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OFT investigates online hotel deals

12/08/13

By James O'Brien

The Office of Fair Trading (OFT) is seeking feedback on whether online bookers are really getting value for money on hotel deals.

The OFT is in the process of looking into how two online travel agents (OTAs) - Expedia and Booking.com - operate alongside the InterContinental Hotels Group (IHG).

Fair trading chiefs claim the OTAs "each entered into separate agreements with IHG which restricted each OTA's ability to discount the rate at which room-only hotel accommodation bookings are offered to consumers".

Expedia, Booking.com and IHG have put forward commitments to tackle the OFT's fears.

Ann Pope, senior director in the OFT's services, infrastructure and public markets group, said: "The OFT is consulting on whether these commitments offer an immediate and effective means of injecting some meaningful price competition into the online offering of room-only hotel accommodation bookings where, in our provisional view, none may exist.

"Under the proposed commitments, OTAs would be able to offer discounts off hotel room bookings to qualifying consumers. The OFT would now like to hear the views of all interested parties before it makes its decision on whether to accept the commitments."

The OFT said it had focused on only a few major companies in a bid to achieve a speedy and successful result.

It added: "However, the investigation is likely to have wider implications as the alleged practices are potentially widespread in distribution arrangements in the industry."

IHG said: "IHG notes this morning's announcement from the OFT regarding its investigation into the online supply of room-only hotel accommodation by online travel agents.

"The OFT has today commenced a public consultation on a series of commitments designed to bring an end to this investigation without finding of infringement or the imposition of any fine.

"IHG has worked closely with the OFT to agree these commitments, which are now subject to a consultation period ending September 13, 2013."


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